The Tax Deadline Is April 15. Make These Moves Before You File – Forbes Advisor

If you haven’t yet filed your 2023 taxes, you’re almost out of time. The deadline to file individual income taxes is Monday, April 15, 2024.

Though the clock is winding down—unless you file for a tax extension—there are still some last-minute tax moves you may want to make before the deadline hits.

Don’t Miss Out on Your 2020 Tax Refund—Yes, 2020

According to the IRS, there are $1 billion in unclaimed tax refunds and about 1 million taxpayers never filed a 2020 tax return. The agency says the median potential tax refund for that group is $932.

If you have yet to file your 2020 tax return and expect a tax refund, your time is running out. The IRS typically allows you to claim your tax refund within three years from the tax return’s due date, usually in April. But you have a little bit of a cushion this time: The final deadline to file a 2020 return is May 17, 2024, because the original due date in 2021 was delayed due to the COVID-19 pandemic.

Note that after this deadline, the IRS cannot issue a 2020 refund or apply tax credits to other years in which you may owe taxes.

If you are missing your 2020 tax documents, you can request copies online through the IRS. The agency’s tool lets you view, print or download your 2020 income transcripts. You also can request copies of your forms by mailing Form 4506-T to the IRS.

Don’t Miss Out On Overlooked Tax Breaks

No one wants to pay more income taxes than they have to. Deductions and tax credits can reduce your taxes, and some tax breaks are often overlooked. Here are three you may want to consider before submitting your 2023 tax return.

1. Mileage Driven for Charitable and Medical Purposes

Did you volunteer for your favorite charity? Did you travel to your doctor’s office for checkups and procedures? The IRS will allow you to claim mileage for both medical and charitable purposes during the year.

To qualify, you must itemize your deductions on Schedule A of your Form 1040. For the 2023 tax year, you can claim 14 cents per mile for charity and 22 cents per mile for any driving for medical purposes.

If your deductions total more than your applicable standard deduction, you should itemize and write off medical, dental, charitable, mortgage interest, taxes and other expenses. Generally, the 2023 standard deduction for married couples filing jointly is $27,700. For a single filer, the amount is $13,850, and for a head of household, it’s $20,800.

2. State Taxes Paid for a Prior Year

If you paid state, local or foreign income taxes in 2023 for a prior year, you can deduct them on your tax return. The IRS allows a deduction if the tax was imposed on you and you were required to pay it during the year.

Real estate taxes, general sales taxes and personal property taxes are examples of deductible taxes. To qualify for the deduction, you need to itemize your deductions using Schedule A of Form 1040.

3. Individual Retirement Account (IRA) Contributions

There is still time to contribute to a traditional IRA and slash your tax bill. The IRS allows you to count contributions you make before or on the tax deadline day for the previous tax year. If you are completing your tax return, you can still make a 2023 traditional IRA contribution until April 15 to take advantage of these tax savings. You must qualify for the deduction, however.

For 2023, you can contribute up to $6,500; the limit increases to $7,500 if you are 50 or older.

Pay What You Can to the IRS To Slash Penalties and Interest

Paying the IRS as much as you can at tax time will help you save money. Any income taxes not paid in full by the tax deadline may incur additional penalties and interest. Even if you cannot afford to pay your entire tax bill, you should pay something toward your balance.

It is important to make a payment toward your income tax balance even if you file for a tax extension. That’s because an extension gives you more time to file but does not extend the time to pay. You can file an extension by submitting Form 4868, “Application for Automatic Extension of Time To File U.S. Individual Income Tax Return,” to the IRS before the tax due date. It extends your time to file until October 15.